One of the many cans being kicked down Washington’s boulevards these days is the government conservatorship of Fannie Mae and Freddie Mac. In 2008, at the height of the financial crisis, Congress and the Bush administration created the Federal Housing Finance Agency (FHFA) and subsequently put Fannie and Freddie into conservatorship under its authority.

Three years later, the federal government has pored $180 billion into the two entities with no clear exit strategy.

Tuesday, Acting Director of the agency, Edward Demarco, sent his congressional overseers a letter, outlining his strategic plan for the Government Sponsored Entities (GSEs). The plan can only go so far, however. Without direction from Congress, there isn’t much DeMarco can do to reform the nation’s mortgage finance system, and the letter reads with a distinct tone of, “What exactly would you like me to do with these?’

Congress has enough on it’s plate that this nearly $200 billion quagmire barely registers on the national stage, but the letter does give us an idea of what DeMarco wants — and doesn’t want — to do with Fannie and Freddie.

In all fairness, the government takeover of the GSEs was the responsible thing to do in order to prevent the total paralyzation of the mortgage market in 2008. And maintaining their participation in the market now is essential to keeping mortgage financing available for prospective homebuyers. But the GSEs are bleeding money and almost everyone, including DeMarco, agrees that finding a private sector replacement, or at least a compliment to them, is necessary.

In the letter, he outlines three strategic goals going forward:

Build a new secondary mortgage marketplace infrastructure, with an eye towards increased private participation in that market;

Contract the GSE presence in the marketplace; and

Help prevent foreclosures and maintain credit availability for new mortgages.

It’s those last two that conflict with each other. Both the Obama administration and Republicans in Congress have expressed their wishes to end government conservatorship of the GSEs and to have private entities play a greater role in the secondary mortgage market — but getting there is potentially painful. Continuing to allow the government to backstop three out of every four new mortgages in this country is creating lower mortgage rates and helping the economy. In an election year, the President doesn’t want to remove that stimulus, and in a recent reversal came out in favor of more government investment in the mortgage market. So it may be a several more years – and more billions of dollars – before taxpayers can wash their of hands of Fannie Mae and Freddie Mac.